PORTUGAL Law and Practice Contributed by: Marta Pontes, Hélder Frias and José António Reymão Nogueira, Uría Menéndez
tion (such as boats, cars and aircraft), the appro- priate security instrument is a mortgage. Financial Collateral Arrangements Financial collateral arrangements are governed by Decree-Law No 105/2004 of 8 May 2004, as amended, which implemented Directive 2002/47/EC of the European Parliament and the Council of 6 June 2002 on financial collat- eral arrangements. The collateral granted under financial collateral arrangements can relate to: • cash; • financial instruments; and • credit claims. Financial collateral arrangements cannot be declared invalid, void or be reversed because those arrangements have come into existence on the date of commencement of winding-up proceedings. In the event of the commencement or continuation of winding-up proceedings or the adoption of reorganisation measures in relation to the collateral provider, the financial collateral agreements remain in force vis-à-vis third par- ties, provided that the collateral taker provides evidence that it was not and should not have been aware of the commencement of the wind- ing-up proceedings or adoption of reorganisa- tion measures. 5.2 Form Requirements A mortgage must be granted in a written agree- ment, which shall be in the form of a notarial public deed or a certified private document ( documento particular autenticado ). Pledge Over Shares The form requirements for the creation of a shares pledge depend on the type of securities. A pledge over shares represented by certificates must be registered in the share certificates and
the company’s share registry book, while a pledge over shares represented by certificates deposited with credit institutions or shares rep- resented by book entries must be registered in the individual ownership account where the securities are deposited. In respect of the financial collateral arrange- ments, the only form requirement is that the security document must be evidenced in writing. Since 2017, Portuguese law (Decree-Law No 75/2017, of 26 June 2017) has also allowed the creation of a commercial pledge ( penhor mer- cantil ) with appropriation rights over the pledged assets, provided certain legal requirements are met. In this case, the security document must be in writing, and the signatures must be cer- tified in person ( reconhecimento presencial de assinaturas ). 5.3 Registration Process Mortgage Over Real Estate Property The registration of a mortgage over a real estate property must be filed before the land registry office. After the parties enter into a valid mort- gage agreement, the mortgage is only effective upon registration with the land registry office. Once created, a mortgage is ancillary to the secured obligation and typically only ceases to exist on the discharge of the secured obligation. A provisional registry can be filed even before the contract is executed, based on: • a declaration by the property owner, whose signature must be duly certified in person; or • a promissory sale contract. After the contract is executed, the public deed certificate must be presented to the land regis-
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